The Impact of Supply Chain Integration on Operational Capability in Malaysian Manufacturers

This study aims to explore the effect of supply chain integration (SCI) on operational capability. Using data collected from 201 Malaysian small- and medium-sized manufacturers (SMMs) and rigorous structural equation modeling methods, a total of one main effect and four sub-effects were hypothesized and tested. All the proposed hypotheses were found to be significant, suggesting positive relationships between SCI and operational capability, as well as between sub-constructs of SCI and operational capability. Overall, the findings are particularly important for SMMs owing to resource paucity and the need to draw upon SCI in order to ensure a sustainable operational capability. Recommendations for how to improve operational capability are provided accordingly.